What is the CEMA process?
A Consolidation, Extension and Modification Agreement, or CEMA, loan is an option available to New Yorkers that can drastically reduce the cost to refinance a mortgage. CEMA loans allow borrowers to pay mortgage recording taxes on only the difference between their current principal balance and their new loan amount.
What is CEMA eligibility?
Requirements for the CEMA Loan: CEMA loan applies to those who own a property and planning to refinance it. In other words, you have to own a property to avail of CEMA. The first step to moving forward is the willingness of your existing lender. It is subject to its consent that you may pursue the loan further.
How much do you save on CEMA?
How much money can I save with a Purchase CEMA? A buyer saves between 1.8% and 1.925% in Mortgage Recording Tax on their loan size. A seller saves between 0.4% to 0.65% in New York State Transfer Taxes on the amount of loan the assign to the purchaser.
Who pays NYS mortgage transfer tax?
In NYC, the buyer pays a mortgage recording tax rate of 1.8% if the loan is less than $500,000 and 1.925% if more than $500,000 or more. Buyers of commercial property pay 2.55%. These rates are what the buyer is responsible for. Your mortgage lender will also contribute 0.25%.
Do I need a lawyer to refinance my mortgage in NY?
You are not legally required to have an attorney represent you in a refinance, however they will be able to provide you specific guidance: Occasionally you would not save money with a Refinance. If, for example, you plan to sell the home within 2-3 years, you would probably not recoup the new closing costs.
How can I avoid paying mortgage tax in NY?
Shares and leases are personal property, not real property, so there is no mortgage recording tax. Buying a co-op is the easiest and most obvious way to avoid the entire tax.
Do I have to pay transfer tax on a refinance in NY?
Do you have to pay NYS mortgage tax on a refinance? New York charges a NYS mortgage tax or specifically a recording tax on any new mortgage debt. This rate varies by county, with the minimum being 1.05 percent of the loan amount. But fortunately, homeowners aren’t required to pay the tax again once they refinance.
What are CEMA documents?
CEMA stands for “Consolidation, Extension, & Modification Agreement” and is an agreement between two lenders regarding an existing mortgage. Think of it as taking over the seller’s existing mortgage.
How many months are property taxes collected at closing in NY?
At least one year advance plus two months worth of homeowner’s insurance premium will be collected. In addition, taxes equal approximately to two months in excess of the number of months that have elapsed in the year are paid at closing. (If six months have passed, eight months of taxes will be collected.)
Is a 3.5 interest rate good for mortgage?
The Covid pandemic pushed mortgage rates to record lows, which meant the most qualified borrowers were able to get rates below than 4.5 percent throughout 2021 and the start of 2022. However, rates are rising, and rates at or below 4.5 percent are now considered very good.